Summary: Miss B complained that the Council delayed in dealing with her review request against large overpayments of housing benefit and council tax support and continued to try to recover the debt during the period of delay. This cause Miss B significant distress and caused her partner to borrow money to pay off some of the resultant debt. We found fault with the Council’s actions and it has agreed to increase its payment to Miss B to £500.

The complaint

1. Miss B complained that Havant Borough Council (the Council) delayed excessively in dealing with her review against a decision that she had been overpaid both housing benefit and council tax support and continued to try to recover the overpayment during this period. The overpayment was entirely due to a Council error and was eventually written off, but Miss B had borrowed money because the situation was so stressful, which she is still paying off.

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The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

4. I have considered the complaint and the documents provided by the complainant, made enquiries of the Council and considered the comments and documents the Council provided. Miss B and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

5. In July 2023 the Council made a mistake in recording details connected to Miss B’s claim for housing benefit and council tax support. As a result of this error the Council concluded Miss B had been overpaid approximately £6500 of housing benefit and £4000 of council tax support going back to 2017. It notified her of these overpayments. She also received council tax bills back to 2017 amounting to approximately £5000 to March 2024 and requesting payments of over £700 per month.
6. Miss B queried the overpayments with the Council pointing out the stated changes of her circumstances and household were wrong. She then submitted a formal request for a review of the decision and asked for a hold on recovery while the review was in progress.
7. Miss B’s partner took out a loan of £5,000 using approximately £3500 to pay off some of the council tax debt. The interest on the loan was about £1500.
8. On 25 July 2023 the Council said to Miss B that her case had been referred for a ‘write off review’. The Council said internal processes between 26 July 2023 and 24 August 2023 caused a delay in the form being referred to the team who could process the write off.
9. The Council sent reminder invoices to Miss B on 27 July, 9 and 30 August 2023.
10. In August 2023 Miss B asked again for the debt to be put on hold. On 31 August 2023 the Council said it would put the account on hold for a month to look into her query. Miss B sent two more emails in September and October 2023 complaining that she was still receiving invoices for the debt (on 6, 13 and 27 September 2023).
11. On 20 October 2023 Miss B received a final notice for the debt threatening to take court action against her. On 24 October 2023 the Council told her that the debt had been written off and she should request a refund of the credit on her account.
12. Miss B made a formal complaint about the delay in correcting the error and the failure to hold recovery of the debt during this delay. The Council sent a stage one response which just detailed the errors leading to the overpayment and contained incomprehensible jargon relating to the systems used.
13. Miss B escalated her complaint to stage two of the complaints process. The Council responded on 17 November 2023. It confirmed the debt had been written off and offered her £100 for the distress caused by the delay in doing so.
14. Miss B complained to us as she considered the payment was insufficient for the distress she was caused. In response to my enquiries the Council has offered to increase the payment to £200. It says it has made changes to its processes to ensure debt recovery is put on hold on receipt of all review requests and that communication between internal department is improved.

Analysis

15. The Council has accepted it was at fault for taking over three months to respond to Miss B’s review request in respect of the overpayment decisions. It was also at fault for failing to suspend recovery of the large debt during this period. I welcome the Council’s recognition of the fault, but I do not consider it has properly acknowledged the injustice this has caused to Miss B.
16. Not only was it a shock to receive bills for over £10,000 out of the blue with no adequate explanation, but this distress was compounded by the raft of bills and invoices which immediately followed and the demands for impossibly large monthly repayment amounts.
17. The stress of the situation was prolonged by the continuing invoices and the complete lack of response to her requests to hold the debt recovery. Even when the Council agreed to hold the account for a month Miss B continued to receive demands for payment and eventually a threat to take her to court. The sudden large debt was the main driver for Miss B’s partner to borrow money to try and cope financially. This has cost them £1500 in interest. I understand they paid off some other smaller debts with the money but the timing of the loan and the fact that 70% of it was used to pay off the council tax, supports Miss B’s view that the overpayments were the main reason for borrowing money.

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Agreed action

18. I welcomed the Council’s offer to increase its symbolic payment to £200, but I considered this should be increased for the reasons detailed above. So I recommended that within one month of the date of my final decision the Council should apologise to Miss B and pay her £500.
19. The Council has agreed and should provide us with evidence it has complied with the above actions.

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Final decision

20. I consider this is a proportionate way of putting right the injustice caused to Miss B and I have completed my investigation on this basis.

Investigator’s final decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman